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London open: Stocks flat as investors digest corporate earnings

Thu, 31st Jul 2014 09:15

- Lloyds falls despite H1 profit beat- Shell, BG, BT and Diageo rise after results- Weir and Rolls-Royce disappoint- US data and Fed in focustechMARK 2,771.22 -0.29%FTSE 100 6,777.11 +0.05%FTSE 250 15,521.52 -0.69%Another wave of corporate earnings was keeping investors busy on Thursday morning, though UK markets were trading more or less flat early on ahead of yet more key economic data from the States.Jonathan Sudaria, a dealer from Capital Spreads, said that European markets were showing "similar indecisiveness" as indices in US and Asia overnight."There's a huge amount of uncertainty already stalking sentiment at the moment with the situation in Ukraine still so fluid but also the natural caution ahead of tomorrow's US jobs data," he said.The FTSE 100 was up just 0.05% at 6,777 within the opening hour in London.Markets were continuing to digest the Federal Reserve's decision on Wednesday night to taper stimulus by $10bn a month for the sixth straight time, putting the central bank on course to end its quantitative easing programme in October.However, with the end of monetary stimulus now fast approaching, Wednesday's much-better-than-expected US growth figures have "made traders nervous and good news has once again become bad news fearing that the beginning of monetary tightening is only around the corner", Sudaria said.As for Thursday's session, the focus will be on the weekly data on US initial jobless claims, which are forecast to have risen to 300,000 from a post-recession low of 284,000 the previous week.Nevertheless, Friday's all-important 'official' US employment report will be more closely watched by traders with analysts predicting a 231,000 gain in non-farm payrolls in July, down from an impressive 288,000 in June. The unemployment rate is expected to remain unchanged after falling to 6.1%, its lowest since September 2008.Investors weigh earnings, Lloyds dropsBanking group Lloyds underwhelmed after saying that underlying profits improved by 32% to £3.82bn in the first half of the year, ahead of the £3.6bn consensus forecast. This was achieved despite a 2.2% fall in total underlying income to £9.25bn.Oil major Royal Dutch Shell impressed with shares rising strongly after saying earnings more than doubled in the second quarter to $5.1bn, even when including a $1bn net charge due to impairments. Natural gas group BG Group was also higher as it lifted its interim by a tenth after a strong second quarter led to a 9% increase in earnings per share in the first half.Earnings at BT were also robust in its fiscal first quarter despite a 2% fall on the top line. The telecoms group said it has made a "good start to the year" with adjusted profits up 7%.Drinks giant Diageo gained after saying that an improvement in sales in the fourth quarter helped to limited the bottom-line decline for the full year. Annual adjusted EPS fell over 7% year-on-year.Heading the other way was engineer Weir after reporting that profits slid 6% in the first half, reflecting adverse foreign exchange currency exchange rate movements and challenging conditions in the mining industry. Jet engine maker Rolls-Royce also disappointed with a 20% drop in underlying profits in the first half, though it did forecast a significant improvement in the second half.On the FTSE 250, Afren shares plummeted after the company said that it has suspending its chief executive officer and chief operating officer as an investigation found "the receipt of unauthorised payments potentially for the benefit of the CEO and COO".FTSE 100 - RisersRoyal Dutch Shell 'B' (RDSB) 2,587.00p +3.94%Royal Dutch Shell 'A' (RDSA) 2,465.00p +3.46%BG Group (BG.) 1,216.50p +3.05%Intu Properties (INTU) 325.50p +1.62%BT Group (BT.A) 393.30p +1.39%GlaxoSmithKline (GSK) 1,433.00p +0.56%BP (BP.) 484.35p +0.54%Diageo (DGE) 1,798.50p +0.53%BAE Systems (BA.) 427.20p +0.52%BHP Billiton (BLT) 2,057.50p +0.46%FTSE 100 - FallersWeir Group (WEIR) 2,567.00p -3.79%International Consolidated Airlines Group SA (CDI) (IAG) 328.40p -2.67%St James's Place (STJ) 735.50p -2.58%Ashtead Group (AHT) 894.00p -2.30%Barratt Developments (BDEV) 350.00p -2.15%Sports Direct International (SPD) 670.00p -2.12%GKN (GKN) 344.30p -1.99%Lloyds Banking Group (LLOY) 75.07p -1.75%3i Group (III) 380.20p -1.73%Royal Mail (RMG) 413.60p -1.66%FTSE 250 - RisersLaird (LRD) 284.50p +6.28%Countrywide (CWD) 535.00p +3.88%Essentra (ESNT) 794.00p +2.72%Bodycote (BOY) 707.00p +2.02%Thomas Cook Group (TCG) 124.30p +1.97%Inchcape (INCH) 649.50p +1.88%Spirent Communications (SPT) 103.90p +1.86%Daejan Holdings (DJAN) 4,750.00p +1.34%Evraz (EVR) 98.05p +1.03%Poundland Group (PLND) 323.30p +1.03%FTSE 250 - FallersAfren (AFR) 100.00p -32.80%Balfour Beatty (BBY) 238.00p -5.82%Carillion (CLLN) 337.00p -4.59%Keller Group (KLR) 860.50p -3.31%Perform Group (PER) 205.40p -3.16%Investec (INVP) 503.50p -2.99%Pace (PIC) 327.50p -2.93%Ocado Group (OCDO) 333.00p -2.83%Galliford Try (GFRD) 1,258.00p -2.78%Jupiter Fund Management (JUP) 384.70p -2.36%BC
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